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OTCQB: HIIT Corporate Presentation
August 2014
HII Technologies, Inc.
Disclaimer This presentation and related commentary may contain "forward-
looking statements" within the meaning of Private Securities
Litigation Reform Act of 1995. Any statements as to matters that
are not of historic fact are forward-looking statements. These
forward-looking statements are based on HIIT's current
expectations, estimates and projections about HIIT, its industry,
its management's beliefs and certain assumptions made by
management, and include statements regarding future
operational and activity expectations, anticipated financial
performance in 2014 and beyond. No assurance can be given
that such expectations, estimates or projections will prove to have
been correct. Whenever possible, these "forward-looking
statements" are identified by, words such as "expects,"
"believes," "anticipates" and similar phrases. Readers and any
audience are cautioned that any such forward-looking statements
are not guarantees of future performance and are subject to
certain risks, uncertainties and assumptions that are difficult to
predict, including, but not limited to:
Risks that HIIT will be unable to achieve its financial, capital
expenditure and operational projections, including quarterly
projections of revenue and risks that HIIT's expectations
regarding future activity levels, customer demand, and pricing
stability may not materialize (whether for HIIT as a whole or for
geographic regions and/or business segments individually); risks
that fundamentals in the U. S. oil and gas markets may not yield
anticipated future growth in HIIT's businesses, worsen from the
recent market declines, and/or that HIIT could experience further
unexpected declines in activity and demand for its rental
equipment service, risks relating to HIIT's ability to implement
technological developments and enhancements; risks relating to
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compliance with environmental, health and safety laws and
regulations, as well as actions by governmental and regulatory
authorities; may not be able to reduce, and could even experience
increases in, the costs of labor, fuel, equipment and supplies
employed and used in HIIT's businesses; risks relating to changes in
the demand for or the price of oil and natural gas; risks that HIIT
may not be able to execute its capital expenditure program and/or
that any such capital expenditure investments, if made, will not
generate adequate returns; and other risks affecting HIIT's ability to
maintain or improve operations, including its ability to maintain
prices for services under market pricing pressures, weather risks,
and the impact of potential increases in general and administrative
expenses.
Because such statements involve risks and uncertainties, many of
which are outside of HIIT's control, HIIT's actual results and
performance may differ materially from the results expressed or
implied by such forward-looking statements. Given these risks and
uncertainties, readers are cautioned not to place undue reliance on
such forward-looking statements. Other important risk factors that
may affect HIIT's business, results of operations and financial
position are discussed in its most recently filed Annual Report on
Form 10-K, recent Quarterly Reports on Form 10-Q, recent Current
Reports on Form 8-K and in other Securities and Exchange
Commission filings. Unless otherwise required by law, HIIT also
disclaims any obligation to update its view of any such risks or
uncertainties or to announce publicly the result of any revisions to
the forward-looking statements made here. However, readers should
review carefully reports and documents that HIIT files periodically
with the Securities and Exchange Commission.
HII Technologies, Inc.
HII TECHNOLOGIES
2
HII Technologies (HIIT) in Houston, Texas is a
frac water management services company
focused on providing total water management
for oilfield companies. HIIT also has supporting
service solutions with Safety and Power.
Services for horizontal drilling and
hydraulic fracing in the domestic U.S.
HII Technologies, Inc.
$46.5 million
Market Cap
HII Technologies Inc. is publicly traded and quoted on
the OTCQB under the symbol HIIT
Market Cap, Price, Shares Outstanding and Average Volume: as of 8/15/14 Assets, Liabilities, and Equity numbers: as of 6/30/14
Current Price
In thousands
Balance Sheet
$0.87
Approximately 53.1 million
shares outstanding
Average volume (3m): 111,216
Management & Board own
approximately 23% of shares
Current Financial Snapshot
Stock Performance
Total Assets $20,573
Total Liabilities $16,567
Total Equity $4,006
Cash Position $1,728
Accounts Receivable $6,271
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
2013A 2014E
Revenue
$MM
$14.6
Recently added guidance
*Pro forma
$50-$53*
HII Technologies, Inc.
AES Water Solutions (AES) AquaTex, and Hamilton Water Transfer
support hydro-fracturing through complete water management
services including water transfer, flow back and well testing, frac
water recycling, evaporation, and tank storage.
South Texas Power (STP) manages remote power needs in the
field for oil operators by supplying portable generated power
and lighting on a rental basis.
AES Safety Services (AES-SS) maintains compliance with
safety regulations for operators by providing certified safety
contractors, training and inspection.
HIIT has aggressively built a full suite of services, which are
essential to the activity of domestic E&P companies.
Key Products and Services
WATER
SAFETY
POWER
& Hamilton
HII Technologies, Inc.
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9
10
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Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15
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As oil and gas activity continues to
expand, the demand for water used
for drilling and fracing is also growing.
Market Demand
U.S. Crude Oil and Liquid Fuels Production million barrels per day (MMBBL/D)
EIA Data as of May 6, 2014
Total Production
Production Forecast
Market Research firm Lux Research expects the frac water clean-up market
to grow to $9 Billion in 2020
By 2015, the Energy Information Administration
expects U.S. annual crude oil production to
exceed 2013 levels by 24%.
The 2015 forecast represents the highest annual
average level of production since 1972.
HII Technologies, Inc.
Hamilton Water Transfer
HII Technologies, Inc.
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Water Transfer
The Company's water division is hired by oilfield operators to provide above ground temporary pipe or lay flat hose infrastructure from a water source such as a river or a pond to a frac site – usually into tanks for frac companies to perform frac completion work. Our high volume pumps, turbo engines, no-leak hose, and connectors typically deliver 5-10 million gallons of water per frac job, and the average job requires 5 miles of hose.
We offer clients
significant savings over
the transportation costs
of trucking water
to frac sites.
Company
pumps Water Source
Frac
Hydraulic Fracing
Site
Our pipe,poly, flat hose
Revenue is earned by rentals charged by the foot and by the day,
plus ancillary rental fees on pumps, manifolds, and road crossings.
HII Technologies, Inc.
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› Direct high temperature/high pressure
water into onsite tanks
› Separate gas and sand from the flow
back water
› Use flare stacks until lines and storage
tanks are in place
“Flow back” is water used to fracture
the shale that flows back to the
surface. The volume of recovery
may be between 20 and 40% of the initial volume injected.
We provide services to handle the
large volume of water that flows
back after a frac is completed.
Compny manifolds,
sand traps, &
gas separators
Tanks
Flow back
Services
Frac
Hydraulic Fracing
Site
Flow Back
Revenue is earned by equipment rentals charged on a day rate basis.
HII Technologies, Inc.
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Recycling
› Removes 99% Total Suspended
Solids (TSS) above 5 microns
› Kills ~99% bacteria
Our technology addresses the need for
solids-free water for reuse: Trucking water means significant costs
and issues, plus friction between E&P
companies and the communities in
which they operate.
We address these issues by offering
mobile units which can clean up to
20,000 barrels of frac flow back per
day, on site.
The treated water can then be used
for additional hydraulic fracturing:
eliminating costs associated with
disposal and use of additional fresh
water.
Revenue is earned by clients paying per barrel of water recycled.
HII Technologies, Inc.
HIIT has an exclusive for
Oklahoma and Texas with
Resource West and its
environmentally friendly
Landshark & Barracuda
wastewater evaporators.
Resource West was
formed in 2006, and has
evaporation equipment in
26 states and 11 countries.
Besides the economic benefits compared
to trucking/disposal, evaporation from
on-site water containment eliminates the
following concerns of local communities:
› Road deterioration
› Noise
› Pollution
› Property devaluation
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Evaporation:
Innovative Green Technology In Lieu of Expensive Trucking and Disposal
Revenue is earned by a per barrel charge.
HII Technologies, Inc.
Other Water Service Offerings
Above ground on-site water storage tanks
› Can be assembled in under 7 hours
› Capacities of up to 53,000 barrels
of water
› Necessary when time on-site
doesn’t allow for pits
Top-hole solids control systems
and drilling fluids reprocessing
Water well drilling and open pit
design/procurement
11
Revenue is earned based on day rates charged for rental equipment.
HII Technologies, Inc.
On-site rapid accelerated pit evaporation
Solids removal Pit remediation
FRESH
WATER
WATER
TRANSFER
FRAC JOB
FLOW BACK SYSTEM
RECYCLE UNIT
ABOVE GROUND
WATER STORAGE
50+ miles aluminum pipe& lay flat non-
leak flat hose
Low profile road crossings
High performance water transfer pumps
On-site 2x2 manifolds
Gas separators packages
Sand traps
Flare stacks
Well testing equipment
Mobile & on-site
Water storage tanks
Quick set up & demobilization
Up to 53,000 barrel water capacity
Water transfer
Distribution manifolds
Recycle up to 20,000 barrels/day of water
Removes up to 99% total metals & TSS
99% Bacteria removals
EVAPORATION
Total Frac Water Management
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HII Technologies, Inc.
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Complements HIIT existing
water division: › Geographic focus is eastern
Oklahoma covering the Woodford-Cana and Mississippian Lime formations
› Customer base is mostly different E&P operators
› Broad suite of service offerings including above-ground tanks, onsite high volume recycling and evaporation services
› Inventory of approx. 50 miles of aluminum pipe and lay flat hose as well as pumps, and other related equipment, which they deploy in a
services rental business model similar to AquaTex and AES Water Solutions.
› Oilfield operators contract with HIG to provide the necessary 5 to 10 M gallons of water needed for a single hydraulic fracturing completion or ‘frac’ of a well.
Hamilton Water Transfer Acquisition - August 2014 - $11.3 M in cash and stock
Hamilton provides frac water transfer services to oilfield services companies located in Oklahoma
and North Texas.
2012 2013
Revenues $8.5 M $12 M
EBITDA $2.3 M $4.3 M
Hamilton Financials
HII Technologies, Inc.
AES
HII Technologies, Inc.
AES Safety Services Overview
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AES Safety Services (AES-SS) provides on-site safety personnel on a contract basis to oilfield clients.
AES-SS revenues derived from:
› On-site safety engineers from drilling to completion
› Procedure monitoring and inspection
› Safety Training
› Developing customized HSE programs and safety plans for compliance
› Site remediation
Allows HIIT to cross-pollinate services with water and power divisions
Due to increasing regulatory requirements, many E&P
companies are relying on outsourced safety personnel.
HII Technologies, Inc.
SOUTH TEXAS POWER
HII Technologies, Inc.
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STP revenues are derived from
the rental of: › Diesel & natural gas generators
› Light towers
› Safety trailers
› Related power equipment
Portable onsite power generation
is critical to oilfield operations.
About STP
Portable power management
solutions company
Plus, STP offers 24/7 service contracts
HII Technologies, Inc.
Corporate Summary
HII Technologies, Inc.
0
10
20
30
40
50
60
70
80
APR JUN AUG OCT DEC FEB APR JUN AUG OCT DEC FEB APR
2012 2013
Customer Growth
2014
14.1% Compounded Monthly Growth
HII Technologies, Inc.
61% of the U.S. land based
oil & natural gas drilling rigs are located in
Oklahoma and Texas
Source: BHI Rig Count 5/30/14
HIIT participates in the following unconventional tight oil and shale formation plays:
› Eagle Ford Shale › Permian Basin › Eaglebine › Mississippian Lime › Woodford
› Cline Shale › Granite Wash › Utica Shale and others
Activity Concentration
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HII Technologies, Inc.
Barriers to
Entry
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Competitive
Advantages
› 80+ MSAs
› Typical range of 3-5 years
› Bundled service providers are preferred over single service companies
Master Service Agreements (MSAs)
› Management team has multiple decades of experience with customer base
› Reputation for quality equipment and service
› Local presence
Long-Term Relationships
› Exclusive relationship with Resource West
› Significant cost savings vs. trucking to disposal wells
Leading Evaporation Technology
› Substantial cost savings relative to sourcing fresh water
› Full spectrum of frac water services
Recycling Commercialization
HII Technologies, Inc.
MATTHEW FLEMMING CEO & President of HII Technologies
› 20+ years industrial, oilfield and manufacturing experience
› Former Director and CFO at Hemiwedge Industries, Inc. (sold 2011)
› Former CEO of Faro – a specialty products company (successfully merged)
› Significant acquisition and capital raise experience
BRENT MULLINIKS President of AES Water Solutions and Director of HIIT
› Petroleum engineer with over 25 years of experience
› Former VP of Engineering at Reichmann Petroleum Corporation
› Former VP of Oil and Gas Operations for Devonian Resources, Inc.
› Involved with horizontal drilling and fracing in the Barnett
Shale since inception
BILLY COX Vice President AES Water Solutions
› More than 25 years experience in oilfield services, operations, field crew management, and business development
› Responsible for all aspects of water transfer used in hydo-fracing and AES field operations.
CHARLES DAVIS President AES Safety Services
› Ten years experience in all aspects of oil and gas safety services with Petrohawk and Talisman companies
› Experienced in managing safety engineering contractors in Ohio and West Virginia
CHAD CRADY President, South Texas Power
› 10+ years experience in oilfield portable power generation, construction and fabrication
› Experienced in servicing E&P, refinery, petrochemical and midstream sectors of the oil and gas industry
Management & Board
CHRIS GEORGE President of AquaTex
› 20 years experience in oilfield services and water management
MARK HAMILTON President of Hamilton Water Transfer
HII Technologies, Inc.
2014 Guidance
• Pro forma 2014 revenue projected to be $50 to $53 million
• Pro Forma Adjusted EBITDA projected to be $8 to 10 million
Total shares outstanding (before any other acquisitions) are approximately
53.1 million post-close of the Hamilton acquisition; 64.3 million on a fully
diluted basis using the Treasury Method
HII Technologies, Inc.
Focus on Critical
Oilfield Services
Investment Highlights
› Relatively inelastic market
› Full suite of frac water services
Leading Position
in Core Oilfield
Markets
› Increased activity forecasted
› Relationships with leading E&Ps
Proven Financial
Platform & Strategy
› Strong organic financial growth
› Successful acquisition integration
Innovative
Technology
› Exclusive relationship
› Economically prudent, ecologically desirable
Highly
Experienced
Management
Team
› CEO Matt Flemming and President Brent Mulliniks (50+ years combined experience)
› Proven track record of delivering shareholder value
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HII Technologies, Inc.
Contact
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HII Technologies, Inc.
710 N. Post Oak Road, Suite 400
Houston, Texas 77024
713-821-3157
www.HIITinc.com
Investor Relations
MZ Group
Derek Gradwell - SVP, Natural Resources
512-270-6990
www.mzgroup.us